The requirement for ASIC to give warnings and reprimands to financial advisers in specified circumstances was introduced by the Financial Sector Reform (Hayne Royal Commission Response—Better Advice) Act 2021 (Better Advice Act).
ASIC has today released Information Sheet 270 Warnings and Reprimands (INFO 270) which explains:
- what warnings and reprimands are
- when ASIC will give a warning or reprimand
- how ASIC will communicate the giving of a warning or reprimand
- when and to whom ASIC will provide procedural fairness before giving a warning or reprimand, and
- the adviser’s right of review of ASIC’s decision to give a warning or reprimand.
For more information, see INFO 270.
The Better Advice Act gives effect to Recommendation of 2.10 of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry by giving the Financial Services and Credit Panel (FSCP) its own legislative functions and powers to address a range of circumstances and misconduct by financial advisers.
Under the Better Advice Act, from 1 January 2022, ASIC must convene a sitting panel of the FSCP in circumstances prescribed in regulation 12N of the Australian Securities and Investments Commission Regulations 2001.
In other circumstances relating to less serious misconduct, ASIC is not required to convene a sitting panel but must give a warning or reprimand if we do not propose to convene a sitting panel or exercise our other enforcement powers.